On A 20 Percent Annual Inflation Rate, New Prescription Prices Have Risen To $180,000 Per Year.

Although much of the focus has been on price increases for current prescription medications, skyrocketing launch prices also contribute to rising expenses.

According to experts at Harvard-affiliated Brigham and Women’s Hospital in Boston, the typical launch price of a new medicine in the United States rose from $2,115 in 2008 to $180,007 in 2021, representing a 20% annual inflation rate. Even after accounting for factors such as drug makers’ focus on expensive disease categories such as cancer and projected discounts given to some consumers, the yearly inflation rate in launch prices throughout the period was about 11%.

New drugs are constantly introduced by pharmaceutical companies in order to improve the efficacy or tolerability of existing treatments. While the public’s attention has been drawn to year-over-year price increases for existing prescription drugs, the study finds that high launch prices also contribute to rising expenses.

According to the researchers, over 47% of new pharmaceuticals introduced in 2020 and 2021 will cost more than $150,000 per year, compared to only 9% of new treatments introduced from 2008 to 2013. The report, which was published in the JAMA medical journal, is based on a review of annual list costs for 548 medications released between 2008 and 2021, using data from the SSR Health research organization. A smaller group of 395 medicines were used in the discounted pricing study.

The researchers concluded in the study that “the rise in new drug pricing outpaces growth in prices for other health care services.”

Source: https://www.benefitspro.com/2022/06/08/new-drug-prices-soar-to-180000-a-year-on-20-annual-inflation/